In today’s briefing:
- Korea’s Dividend Narrative Is Back: Unpacking the DP’s New Bill and Its Backstory
- US Government May Acquire Equity Stakes in Samsung Electronics and TSMC
- Lynch Group (LGL AU): (Another) Clean Offer From TPG
- Hillhouse’s Competing Bid Challenges Smart Share Global’s Management-Led Privatization
- Lynch Group (LGL AU): TPG’s Scheme Offer
- Abacus Storage (ASK AU): Time To Get Some Exposure?
- Abacus Storage King (ASK AU): Caution Is Warranted
- Fortescue (FMG AU) Results on 26 Aug: Expected Price Swings and Volatility Outlook
Korea’s Dividend Narrative Is Back: Unpacking the DP’s New Bill and Its Backstory
- A new bill cutting Korea’s dividend tax hit the tape, giving local dividend plays an immediate boost on the news flow.
- The presidential office is aligned on pushing the dividend tax below the 27.5% CGT floor. The new party leader is also tightly syncing with the Blue House to avoid clashes.
- The DP’s tax cut move today puts the gov’s dividend narrative back in play with juice. We need setups to ride this theme.
US Government May Acquire Equity Stakes in Samsung Electronics and TSMC
- According to Reuters, the US government may be interested in acquiring equity stakes in Samsung Electronics and TSMC in exchange for CHIPS and Science Act grants.
- The US government is exploring ways to take equity stakes in these two Asian tech giants that have been expanding their semiconductor facilities in the United States.
- If the US government decides to invest $10 billion each in Samsung Electronics and TSMC, they would represent about 3% and 1% of Samsung Electronics and TSMC’s market caps, respectively.
Lynch Group (LGL AU): (Another) Clean Offer From TPG
- Lynch Group (LGL AU), an integrated wholesale floral play, has entered into a Scheme Implementation Deed with Hasfarm Holdings and Darwin Aus Bidco – both of which are TPG entities.
- Hasfarm is offering A$2.245/share, a 28.3% premium to last close. The consideration includes a fully franked dividend of A$0.09/share. It’s April 2021 IPO price was A$3.60/share.
- The Offer has unanimous board support. 38.5% of the register is supportive. Hasfarm has also entered into a call option for 19.9% of shares out. Done deal.
Hillhouse’s Competing Bid Challenges Smart Share Global’s Management-Led Privatization
- Smart Share Global’s management consortium signed a definitive agreement to acquire the company at $1.25/ADS, later challenged by Hillhouse’s $1.77/ADS bid.
- Hillhouse’s competing bid is 40% higher than management’s offer, with significant shareholder stakes potentially influencing the outcome.
- EM’s business is unprofitable, with declining power bank rentals, but holds a net cash pile of $1.6/ADS.
Lynch Group (LGL AU): TPG’s Scheme Offer
- Lynch Group Holdings (LGL AU) has entered a scheme implementation deed with TPG Inc (TPG US) at A$2.245, a 28.3% premium to the undisturbed price of A$1.75 (19 August).
- Lynch has several substantial shareholders, which poses a vote risk. Encouragingly, four out of eight substantial shareholders are supportive.
- The offer is attractive compared to historical trading ranges. The scheme meeting is estimated to be in November, with payment in December.
Abacus Storage (ASK AU): Time To Get Some Exposure?
- On the 7th April, the Ki Corporation/Public Storage (PSA US) consortium announced a NBIO, by way of a Scheme, for shares not held in Abacus Storage (ASK AU) at A$1.47/security.
- ASK rejected the Offer on the 13th May. The Kirsh-led consortium bumped non-binding terms 14.7% to A$1.65/share on the 14th July, and was granted six weeks of due diligence.
- DD expires on or around the 1st September. Nathan Kirsh directly/indirectly holds a 59.47% stake in ASK. Currently trading at a 7.5% spread to the indicative terms.
Abacus Storage King (ASK AU): Caution Is Warranted
- The six-week due diligence for Ki Corporation and Public Storage (PSA US)‘s A$1.65 offer for Abacus Storage King (ASK AU) ends on 1 September.
- Some readers have asked if ASK is attractive at the current 7.5% gross spread. I think caution is warranted as there is a medium-to-high probability of no deal.
- The probability of a binding scheme is low, as NSR will block it, and the Board requires a bump to recommend it. A takeover offer is not a credible alternative.
Fortescue (FMG AU) Results on 26 Aug: Expected Price Swings and Volatility Outlook
- Timing:Fortescue (FMG AU) is scheduled to report its FY2025 full-year results on Tuesday, 26 August 2025.
- Highlight: The options market provides estimates for the anticipated price move and the upcoming dividend. Implied volatility is projected to decline post-event; this Insight maps the resulting term structure.
- Why Read: Get the expected move, the dividend outlook, and a clear view of the post-event volatility term structure to be ready for results day.
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